WASHINGTON (CNN) --Saying the United States needs an immigration system "that serves the American economy and reflects the American dream," President Bush Wednesday outlined an plan to revamp the nation's immigration laws and allow some eight million illegal immigrants to obtain legal status as temporary workers.

"Over the generations, we have received energetic, ambitious optimistic people from every part of the world. By tradition and conviction, our country is a welcoming society," he said. "Every generation of immigrants has reaffirmed the wisdom of remaining open to the talents and dreams of the world."

"As a nation that values immigration and depends on immigration, we should have immigration laws that work and make us proud," he said. "Yet, today, we do not."

Bush said the reform confronts "a basic fact of life and economics -- some of the jobs being generated in America's growing economy are jobs American citizens are not filling."

"These jobs represent a tremendous opportunity for workers from abroad who want to work and to fulfill their duties as a husband or a wife, a son or a daughter," he said.

Bush also touted his immigration proposals as a national security measure, saying it will help the United States exert more control over its borders.

"Our homeland will be more secure when we can better account for those who enter our country," he said. "Instead of the current situation, in which millions of people are unknown ... law enforcement will face few problems with undocumented workers and will be better able to focus on the true threats to our nation from criminals and terrorists," he said.

But while temporary workers will have the opportunity to try to stay in the United States permanently, they will be encouraged to return to their home countries with financial incentives and, if they do decide to stay, will have to compete with migrants outside the country for the limited number of immigration slots, the president said.

"I oppose amnesty -- placing undocumented workers on the automatic path to citizenship," he said. "Granting amnesty encourages the violation of our laws and perpetuates illegal immigration. America's a welcoming country. But citizenship must not be the automatic reward for violating the laws of America."

Currently, about 140,000 "green cards" are issued each year to people wanting to migrate to the United States. Bush said Wednesday that number is too low, and he called on Congress to raise it, although he did not give a specific number.

Illegal immigrants already in the United States can only apply for the temporary worker program if they already have a job. The special status would last for three years and could be renewed once, for a total stay of six years. If temporary workers failed to stay employed or broke the law, they would be sent home, Bush said.

Bush said the new legal status would allow illegal immigrants to travel back to their home countries, without the fear they would not be allowed to return to the United States, and he said it would also help keep immigrants from being abused or exploited. (Border residents question immigration proposal)

"This new system will be more compassionate. Decent, hardworking people will now be protected by labor laws, with the right to change jobs, earn fair wages and enjoy the same working conditions that the law requires for American workers," he said.

"Temporary workers will be able to establish their identities by obtaining the legal documents that we all take for granted. And they will be able to talk openly to authorities to report crimes when they're harmed without the fear of being deported," he said.

People outside the country will also be able to obtain temporary worker status if they have a job offer from an American employer. Bush said employers would have to prove that they cannot fill the job with an American worker before they would be allowed to hire a non-citizen as a temporary worker. And if the worker quit, the employer would have to notify the government.

The U.S. Department of Homeland Security, in coordination with the Labor Department and other agencies, would administer the new program, as it does with other temporary visa programs.

The immigration proposal, unveiled by Bush in a speech in the East Room of the White House, is his first major new policy initiative of the 2004 election year. He outlined his idea in broad strokes, rather than providing specific legislation. Administration officials said many of the details would be worked out in consultation with Congress.

The White House initiative is modeled after several proposals pending in Congress.

For example, U.S. Rep. Jim Kolbe, R-Arizona, has called for a temporary worker program if employers initially post jobs on the Internet for 14 days to give Americans a first crack.

Politically motivated?

The Bush plan also tracks many proposals advocated by Democrats, some of whom have voiced suspicion that the administration is seeking to increase the president's appeal to Latinos as the 2004 campaign gets under way.

"I certainly hope the administration's long-awaited reinvolvement in this fundamental debate is genuine and not because of election-year conversion," said U.S. Sen. Ted Kennedy, D-Massachusetts, in a statement Tuesday. "The immigration status quo is outdated, unjust and unacceptable.

"At any time in recent months, a nod from the administration could have brought immediate enactment of two important long-stalled immigration bills with broad bipartisan support in Congress -- the AgJobs bill, to reach a fair resolution of the controversy and work conditions over jobs in the agriculture industry, and the bill granting permanent residence to undocumented immigrant children who complete high school and go to college or join the military." (Democrats: Bush immigration plan not enough)

The U.S. Chamber of Commerce is among the president's allies in the debate, agreeing with the White House position about an economic need for new workers.

Randel Johnson, a chamber vice president who deals with immigration issues, said Tuesday that a resolution of the problem is necessary.

"The reality of it is we are not going to deport all these people," Johnson said. "So we have to come up with something to deal with the situation. Or we can continue to put our head in the sand."

But U.S. Rep. Thomas Tancredo, R-Colorado, is among the congressional conservatives who promise to fight provisions they view as rewarding lawbreakers.

Latino community split

The Latino community also appears split over Bush's proposal. The president was joined in the East Room by representatives from several Latino groups, including Hector Flores, president of the League of United Latin American Citizens (LULAC), which bills itself as the nation's oldest and largest Hispanic organization.

But Raul Yzaguirre, president of the National Council of La Raza, which claims to be the nation's largest Latino civil rights organization, issued a statement saying Bush's proposal was a "bitter disappointment" that would relegate immigrants to "second-class status."

Yzaguirre said the plan "appears to offer the business community full access to the immigrant workers it needs, while providing very little to the workers themselves."

"This is at best an empty promise and, at worst, a political ploy aimed a vulnerable immigrants and those of us who care deeply about them," he said.

--CNN Senior White House Correspondent John King and Congressional Producers Ted Barrett and Steve Turnham contributed to this report.